Australian Competition and Consumer Commission chairman Rod Sims has highlighted the importance of major infrastructure to the economy, and its effective regulation.
Addressing a West Australian Chamber of Commerce and Industry event, Mr Sims said that major transport infrastructure provides a critical input for businesses across the country.
“If transport infrastructure is used efficiently, the benefits are felt throughout the economy. If it is used inefficiently, the extra costs are passed on to all those businesses that rely on it, right along the supply chain,” Mr Sims said.
“For this reason, major infrastructure that is a bottleneck to competition in other markets, or that is inefficient to duplicate, can be regulated.”
The National Access Regime in Part IIIA of the Competition and Consumer Act allows third parties to access major infrastructure.
However, Mr Sims noted some lessons from the experience of the last fifteen years.
“The most notable shortcoming is the delay in reaching decisions on whether infrastructure should be declared,” Mr Sims said, citing the processes for declaration of BHPB Billiton’s and Rio Tinto’s railway lines in the Pilbara, and services at Sydney Airport.
“For businesses on both sides of the argument that are enduring these delays, the result is uncertainty and increased costs,” Mr Sims said.
“The cases which have been more successful are those where governments have made specific decisions to require access to infrastructure, such as the recent undertakings accepted from Australian grain bulk handlers allowing for other wheat exporters to access their port terminals to export wheat,” Mr Sims said.
“Governments should continue to play this role in appropriate cases, where effective access to major infrastructure is clearly important to the economy.”